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"Those 18 and 19-year-olds who have not been on a benefit face missing out on jobs, and those who have been on a benefit face missing out on pay."

Labour's labour (correct) spokeswoman Darien Fenton said the legislation did not explain how employers could check if a young worker has been on a benefit for six months.

"Given the current issues around privacy breaches it is questionable as to whether Work and Income should be able to provide that information to employers."

Ms Fenton reiterated the Green Party's stance that it is illegal to discriminate on the grounds of employment status.

"The Government does not believe in young people, it does not like young people, and it dislikes them so much it's going to give them a pay cut," she said.

Labour Minister Kate Wilkinson said the introduction of the new wage, from April next year, would help young New Zealanders get into the workforce.

"The new starting-out wage will help some of our youngest and most inexperienced workers get a much-needed foot in the door, in what is currently a tight labour market."

Youth spokesman for the Council of Trade Unions James Sleep said youth rates will not address high levels of youth unemployment.

He said advice given to the Government by the Ministry of Business, Innovation and Employment indicates that when youth rates are implemented there will always be a group of workers losing out on jobs; with modelling indicating it could lead to a net loss of up to 2700 jobs over two years.

"Youth rates will shift jobs around different age groups, and the Government's own advice suggests at any one point a group of workers will be displaced from work. All workers should have the same minimum wage floor to ensure workers are not displaced because of their age."

"There are currently 13,700 young people aged 18 and 19 who are struggling to find work or get into further education."

He said many of these young people will be living away from home, and face the same living costs as other New Zealanders.

"They need a decent, secure job that pays a wage that allows them to pay for rent, food and other expenses. A youth rate will drive these people into relative poverty."